8911 N. Capital of Texas Highway, Building 2, Suite 2105,
Austin, TX 78759

Call Us512-610-6199

Subscribe to this list via RSS Blog posts tagged in forensic accountant

TX divorce lawyerHigh asset divorces in Austin, TX are complicated for numerous reasons, from matters of property division to alimony. One of the more complex and contentious issues that can arise in a high net worth divorce is the matter of hidden assets. Particularly in high asset divorces where one of the spouses was the primary earner during the marriage, the other spouse may have concerns about hidden or concealed assets. When the non-primary earner does not control the finances of the marriage and does not regularly manage business issues or jointly owned accounts, it can be difficult to know exactly what the assets from the marriage look like in sum. Yet discovering hidden assets can be extremely important given that Texas is a community property state.

Under Texas law, couples who get divorced in Texas should know that community property is owned equally by the spouses. Accordingly, courts divide the property recognizing that both spouses have an equal interest in it while also taking into account what kind of division would be fair to both parties. If there are substantial hidden assets, one of the spouses could end up losing out on property to which she or he is entitled. While assets can be hidden in any divorce—regardless of the extent of the property owned by the married couple—hidden assets in a high net worth divorce can total tens of thousands of dollars. As such, it is essential to ensure that neither spouse is hiding assets in the divorce.

Know Where to Look for Hidden Assets

Even if you do not immediately suspect your spouse of hiding assets, it is important to know where to look for “red flags.” For example, itemized deductions in Schedule A in past tax returns could reveal property that you did not know existed. Or, for instance, details about assets that have generated interest and dividends (located in Schedule B) could reveal that your spouse has more money than she or he has listed. Tax returns can also provide information about business profits and losses (Schedule C), as well as capital gains and losses (Schedule D). Information about capital gains and losses can provide information about certain securities in which your spouse has invested, as well as stocks or real estate.

...

TX divorce lawyerCryptocurrency, or virtual currency, has existed in one form or another since 2009, but has become a much more mainstream investment over the last few years. While it is true that investing in cryptocurrency can be a lucrative endeavor, it can also make for a difficult and lengthy property division process for couples who later decide to divorce. For instance, it is becoming increasingly common for one spouse to use cryptocurrency as a means of hiding assets from the other during the divorce process.

Fortunately, there are ways to prevent this type of behavior, which is unlawful under Texas law, so if you and your spouse have decided to file for divorce and you have questions or concerns about how your marital assets will be divided, you should strongly consider contacting an experienced high asset divorce lawyer who can ensure that you reach a fair and equitable settlement.

Tracing Cryptocurrency

As stated earlier, cryptocurrency is virtual currency that exists only online and is traced on an encrypted ledger that details all transactions. Unfortunately, it is the very nature of cryptocurrency that makes it an ideal means of hiding assets, as it tends to be difficult to trace and hard to value. Divorcing spouses are required to disclose all of their assets and liabilities at the outset of proceedings and while many are forthright in these disclosures, some are not so scrupulous. Cryptocurrency is the perfect vehicle for many of those who fall under the latter category.

...

Texas divorce lawyerThe financial issues that couples must tackle during divorce are some of the most complicated problems that come with dissolving a marriage, especially for couples with significant or diverse assets. In these situations, consulting with a forensic accountant who can help identify concealed assets or appraise unique assets is crucial, so if you and your spouse have filed for divorce and have varied assets, you should consider speaking with an experienced high asset divorce attorney who can help connect you to a well-respected and efficient forensic accountant.

What Is Forensic Accounting?

There are four main financial components to most divorces: assets, income, debts, and expenses. Forensic accountants can help with each of these areas by collecting and analyzing financial documents and then communicating the findings to the clients or the court. This involves completing a wide range of smaller asks, including:

...

Texas high asset divorce lawyer, Texax complex divorce attorneyA survey by the National Endowment for Financial Education found that 30 percent of spouses have been deceptive about money with their spouse, and almost 60 percent admit to hiding money from them. Considering these statistics, it is not surprising that one of the most contentious issues in a divorce is the division of assets. It is not uncommon for one spouse to try to hide assets from the other in order to avoid sharing those assets.

When couples are dissolving their marriage, they are required to provide financial affidavits to the court which reveal any assets they have. Although providing false information to the court is illegal, many spouses would rather take their chances and lie about their assets so they do not have to share them with their soon-to-be ex-spouse. If you are going through a divorce and think that your spouse is hiding assets from you, there are steps that you and your high asset divorce attorney can take in order to find those assets, including:

  • Subpoenas: Your attorney can file a subpoena to any financial institutions that your spouse banks at or your suspect he or she may have accounts at which will require they provide all financial statements and cancelled checks;
  • Forensic accountant: Unlike a traditional accountant, a forensic accountant also utilizes auditing and investigative skills to conduct an examination into an individual or company’s financial records;
  • Private investigator: A private investigator can conduct surveillance on a spouse to document any activity which may indicate hidden assets. A private investigator can also conduct a skip search which uncovers personal information on a spouse, such as credit information, utility bills, title information, and business licensing. These are all items which may indicate assets are being utilized which come for a source a spouse has not revealed.
  • The Internet: Many people do not realize just how much information is contained on the Internet. For example, if a spouse has purchased real estate as a way to hide assets, that transaction is most likely public record published on the web.

Other places that often reveal whether a spouse is hiding assets is their social media sites and Internet browsing history. Browser histories could reveal multiple visits to a bank’s website that the couple do not have funds at. Social media sites, both personal and professional, can reveal all kinds of information, such as posted photos and comments from friends and business colleagues which may reveal that a spouse has more funds than they are revealing.

...

Austin divorce attorney, forensic accountants, high asset divorce, complex divorce, division of property, hidden assetsWhen involved in a high-asset divorce, there are key issues which top the list of importance. Child custody may be number one if a divorcing couple has young children. However, for divorcing couples who either do not have children or have children who are grown, their number one priority often involves finances.

Texas is a community property state. This means that all property a couple has acquired during their marriage needs to be split evenly between the two spouses. Additionally, besides the usual bank accounts, divorcing couples involved in a high-asset divorce may own assets such as stocks, professional practices or businesses, various trust accounts, retirement plans, and insurance plans. Couples may have multiple properties in differing states or in foreign countries, as well as antiques, art, and other expensive collections. All of these items make up the marital estate and need to be evenly divided between the two spouses.

Also, one spouse may choose to hide assets or property from the other spouse in an attempt to keep those assets from being included in the marital estate, especially during a contentious, high-asset divorce. Therefore, it can be beneficial to utilize the services of a forensic accountant. A forensic accountant is specifically trained to recognize trends, patterns, and discrepancies that reveal what should be being reported and what is not being reported. Examples of the underhanded tactics a spouse may employ but can be discovered by a forensic accountant include under-reporting income, creating phony debt, overpaying creditors, and transferring assets to fake companies.

...
Super Lawyers TBLS AV Martindale Avvo Top One Expert Top 10 Law Firm
Back to Top